Italian Pact Would Deprive Macron of Ally for EU Reform

Italian prime minister Paolo Gentiloni is received by French president Emmanuel Macron at the Elysée Palace in Paris, September 27, 2017 (Elysée)

For the first time in its postwar history, Italy could soon be ruled by anti-EU parties. The populist Five Star Movement and (formerly Northern) League are on the verge of forming a coalition government.

Such a pact would deprive French president Emmanuel Macron of a key ally for EU reform.

Why Italy matters

Italy, a founding member of the EU, is one of the most important countries in the bloc.

Despite its economic and demographic challenges, it is still the fourth largest economy in Europe. It has so far been a supporter of closer EU integration. That could change — at the very time Macron is struggling to give the European project a new sense of purpose.

Macron argues that more integration is the only way to safeguard “real sovereignty” in Europe. His proposals include a joint eurozone budget, a European Monetary Fund to provide financial assistance to member states in need, harmonized taxation, a common border police and even a shared military force.

It is unlikely all of these initiatives will be implemented. Macron needs allies to get his reforms through the EU’s complex institutional procedures, but he doesn’t have many.

In search of allies

Germany would be Macron’s ideal partner. The Franco-German “engine” has powered European integration for decades.

But the government in Berlin opposes moves toward fiscal union, such as a common budget, a Monetary Fund and Eurobonds. It fears the money of German taxpayers would be used to bail out other countries, as happened with Greece during the European debt crisis.

Britain, which has traditionally been wary of the EU, is now about to abandon it. Central and Eastern European countries do not generally favor the policies Macron has put forward. Belgium and Luxembourg are pro-EU but too small. The Dutch and Scandinavians are ambivalent.

That leaves Italy and Spain as the only potential partners.

Until now, the former looked like the most viable option given its political weight and its support for EU reforms, but a Five Star-League government puts that at risk.

Spain does not have the same kind of influence. A Franco-Spanish pact would not be enough to rebuild the EU.

Coming after Brexit, an anti-EU coalition in Italy with ties to Euroskeptic forces in Central Europe could be a prelude to deintegration.